GBP/USD Declines Following UK GDP Data Release
Today, the UK GDP changes for October were published, as reported by Forex Factory (month-on-month):
Actual = -0.1%;
Forecast = +0.1%;
Previous = -0.1%.
The data revealed a slowing UK economy, defying analysts optimistic expectations. According to Reuters and other outlets, the latest GDP figures:
Could strengthen traders expectations of a more rapid interest rate cut by the Bank of England in 2025;
Undermine the target announced last week by Prime Minister Keir Starmer to make the UK the fastest-growing economy among G7 nations.
Technical Analysis of the GBP/USD 4-Hour Chart
From its December high (when a false breakout of the psychological 1.29 level occurred), the pound has weakened by approximately 1.4%, with the RSI indicator dipping into oversold territory for the first time this month.
The bullish trajectory (highlighted in blue), formed since late November, has lost its relevance after a breakout, suggesting bears are attempting to resume the downtrend within the red-shaded channel.
The 1.2615 level, which has repeatedly influenced the price (marked with arrows), may continue to act as support.
Looking ahead, the Bank of Englands meeting next Thursday is likely to trigger heightened volatility. While interest rates are expected to remain unchanged, any surprises could significantly impact the current bearish momentum.
Read more: https://fxopen.com/blog/en/oa-gbp-usd-declines-following-uk-gdp-data-release/
Text source: Forex Trading Blog
